Tenants of SRO in Two-Family House May Be Rent Stabilized

Facts: Six tenants sued landlord in State Supreme Court. They asked the court to stop landlord from executing eviction warrants against them, and to declare that they were rent stabilized. Landlord had rented a two-family house from the house owner. Landlord then went to homeless shelters and residential drug treatment programs and sought female tenants to live in the house. Landlord set up multiple beds in the house and presented the living quarters as a sort of halfway house for the women. Tenants paid rent to landlord who, in turn, paid rent to the owner. Landlord later stopped paying rent. The owner sued to evict landlord but didn’t name the individual tenants in the court papers. Tenants claimed that landlord and owner together schemed to evict them and that they would be harmed if evicted before their rights were determined.

Court: Tenants win. Landlord illegally converted the house to a multiple dwelling. At one point, there were at least 13 tenants in the house. If tenants proved at trial that landlord rented at least six dwelling units, the building would be subject to rent stabilization. And since landlord never occupied the house but simply set up the rental arrangement with the owner, landlord appeared to be an illusory tenant. For all of these reasons, tenants were likely to be protected by rent stabilization. Tenants also weren’t properly identified as occupants in the eviction proceeding even though landlord and the owner knew their names. The court granted tenants a temporary injunction barring eviction until a full hearing was held to determine their rights.

Wright v. Lewis: NYLJ, 11/5/08, p. 33, col. 3 (Sup. Ct. Kings; Schack, J)